Opening a certificate of deposit is a smart move to earn safe and steady interest on your savings. As opposed to stock and bond investments, which are not federally insured, the interest earned on CDs is typically higher. A CD can be easily accessed by following these instructions.
Disc-Reading 101
Look, pick a CD that suits your tastes.
An excellent place to begin is to check online for CD interest rate comparisons between federally insured banks and credit unions, keeping in mind the following three considerations: The length of time a CD will last, the sort of CD it is, and the identity of the CD's owner.
There is a wide range of CD formats, the most common being the standard audio CD. Speciality certificates of deposit (CDs), like no-penalty CDs or CDs with additional features, are not offered by all institutions. (Explore nine distinct categories of compact discs.)
Decide on your preferred method of application. 
A certificate of deposit (CD) can be opened in various ways, including online, over the phone, or at a physical branch. When applying for a bank account, some establishments prefer an online submission, while others insist on a personal visit. The time required to complete an online application may range from ten to twenty minutes.
Take out your identification right now.
You will likely be asked to provide a photo ID, mailing address (which must be in the United States), and other contact information like a phone number and email address.
You get to decide how the interest is distributed.
There are typically two ways to receive interest on a certificate of deposit (CD): either at the end of the term or regular intervals (monthly or annually, for example). Maximize your interest by receiving it towards the end of the loan term.
Create the initial (and only) down payment
You can only keep adding to a CD with a savings account. You will deposit a fixed sum and leave it alone until the CD matures. When opening a CD in a branch, you will likely link an existing bank account and transfer funds, send a check by mail, or deposit a check to finance the CD.
Tips and Tricks for Playing CDs 
To compare rates, look at the annual percentage yield (APY). Compounded interest, which adds the principal to what you've already earned on a CD, is what the annual percentage yield (APY) measures.
Changing refund policies
Generally speaking, the longer the term, the higher the rate. If you can wait longer to see a return on your investment, consider a five-year term instead of a three- or four-year one. Rates may be consistent across all terms. However, this is dependent on the financial institution.
Fresh CD Releases In Retaliation
The interest rate on your CD won't change. When compared to a standard savings account, the interest rate on a CD remains constant once it is opened. As the Federal Funds Rate fluctuates, so do the rates banks and credit unions offer on new certificates of deposit. (Discover more about the Federal Reserve and how rate hikes affect CDs in our detailed guide.)
The Withdrawal Fee Calculator
Find out the penalty for withdrawing money from your CD before maturity. Hopefully, you won't need to cash in your CD before it matures, but it's good to know the penalty in advance. The early withdrawal penalty for most CDs is anywhere from several months to an entire year's worth of interest. (Check out the early withdrawal penalty calculator on NerdWallet and the fines imposed by various banks.)
New Interest Rate, Old Contract Term
Put the CD's expiration date on your calendar as a reminder. Usually, you'll have between seven and ten days after the CD's term ends to withdraw your money without incurring any fees. If you don't cancel your CD before its maturity date, the bank may renew it for the same term at the current market rate for new CDs of the same length.
Funds Into A Brand-New CD With A Longer Term
Consider a CD ladder if you're concerned about missing out on more excellent long-term rates in the future. A CD ladder could be an excellent choice when rates are either low or rising. You can diversify your long-term savings by opening many CDs with varying maturation dates, such as a one-year CD, a two-year CD, and a three-year CD. Withdrawals are also possible once the CD maturity period has passed.
